Can we use the health care workforce more efficiently? Insights from variations in practice

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1 CECS Center for the Evaluative Clinical Sciences Can we use the health care workforce more efficiently? Insights from variations in practice Elliott S. Fisher, MD, MPH Professor of Medicine Center for the Evaluative Clinical Sciences Dartmouth Medical School Senior Associate VA Outcomes Group White River Junction, Vermont

2 Variations in spending and physician labor inputs among USN&WR top ten honor roll academic medical centers Inpatient + Part B spending per decedent 120, ,000 80,000 60,000 40,000 20,000 Resource inputs per Medicare beneficiary with severe chronic disease (Last 2 years of life, ) Spending MD FTE UCLA Medical Center 72, New York-Presbyterian 69,962 Johns Hopkins 60,653 UCSF Medical Center 56,859 Univ. of Washington 50,716 Mass. General 47,880 Barnes-Jewish 44,463 Duke University Hosp. 37,765 Mayo Clinic (St. Mary's) 37,271 Cleveland Clinic 35,

3 Spending, quality and the physician workforce Is it possible to provide care with fewer physicians? Higher intensity treatment -- what are we getting? What s going on? What we need to know: how to identify and foster high performing health systems

4 Is it possible to provide care with fewer physicians? Prepaid group practices use fewer physicians Adjusted physician supply per 100,000 in selected prepaid group practices Reduction compared to US U.S. supply Group Health HealthPartners % 25% Kaiser 174 Total providers per 100,000 36% Weiner et al. Health Affairs 2004

5 Is it possible to provide care with fewer physicians? Prepaid group practices use fewer physicians Low intensity U.S. regions achieve equal or better results with fewer physicians

6 Is it possible to provide care with fewer physicians? Prepaid group practices use fewer physicians Low intensity U.S. regions achieve equal or better results with fewer physicians Academic medical centers also differ dramatically in their intensity and use of physician labor Mayo Duke UCSF UCLA Cedars Hospital days (L6M)* Physician visits (L6M)* Total Physician FTE (L2Y)** Primary care FTE inputs (L2Y)** Medical specialist FTE (L2Y)** * Measures are per person / per decedent ** Measures are per 1000 decedents

7 Spending, quality and the physician workforce Is it possible to provide care with fewer physicians? Higher intensity treatment -- what are we getting?

8 The paradox of plenty What do higher intensity regions -- and systems -- get? Content / Quality of Care 1,2 Technical quality worse No more major surgery Greater use of supply sensitive services (1) Ann Intern Med: 2003; 138: (2) Health Affairs web exclusives, October 7, 2004 (3) Health Affairs, web exclusives, Nov 16, 2005 (4) Health Affairs web exclusives, Feb 7, 2006 (5) Ann Intern Med: 2006; 144:

9 Content of care higher vs lower intensity academic medical centers Risk adjusted use of physician services during the first six months of follow-up among patients cared for by U.S. Academic Medical Centers Quintile of AMC Intensity Ratio High Hip Fracture Evaluation and Management Lowest $894 Middle $1,054 Highest $1,628 to Low 1.82 Imaging Diagnostic tests Minor Procedures Major Procedures 1,517 1,526 1, AMI Evaluation and Management 1,120 1,234 1, Imaging 1,054 1,139 1, Diagnostic tests Minor Procedures Major Procedures 2,769 2,777 2, Fisher et al. Health Affairs web exclusives, Oct 7, 2004

10 The paradox of plenty What do higher intensity regions -- and systems -- get? Content / Quality of Care 1,2 Health Outcomes 1,2 Physician s perceptions 5 Patient-perceived quality 1,3 Trends over time 4 (1) Ann Intern Med: 2003; 138: (2) Health Affairs web exclusives, October 7, 2004 (3) Health Affairs, web exclusives, Nov 16, 2005 (4) Health Affairs web exclusives, Feb 7, 2006 (5) Ann Intern Med: 2006; 144: Technical quality worse No more elective surgery Greater use of supply sensitive services Slightly higher mortality No better function Worse communication among physicians Greater difficulty ensuring continuity of care Greater difficulty providing high quality care Greater perception of scarcity Lower satisfaction with hospital care Worse access to primary care Greater growth in per-capita resource use Lower gains in survival (following AMI)

11 Spending, quality and the physician workforce Context: why is this an important question? Is it possible to provide good care with fewer physicians? Higher intensity treatment -- what are we getting? What s going on?

12 Differences in spending What are the underlying causes? Patient preferences? 1,2 Malpractice environment 3,4 Capacity / payment system 5 Slight preference for specialist care in high spending No difference for tests (if MD says not needed) No difference in preferences for aggressive EOL care Explains less than 10% of state differences in spending Little impact on growth in utilization across states Capacity strongly correlated, but explains less than 50% Payment system ensures all stay busy Clinical judgment 6,7 (1) Pritchard et al. J Am Geriatric Society; 46: , 199 (2) Anthony et al, under review (3) Kessler et al. Quarterly Journal of Medicine 1996;111(2): (4) Baicker, Chandra, NBER Working Paper W10709 (5) Fisher et al. Ann Intern Med: 2003; 138: (6) Sirovich et al. Archives of Internal Medicine. 165(19): (7) Sirovich et al, J Gen Intern Med. 2006;21(Suppl4):164.

13 Physician propensity to intervene Primary Care Physician Surveys Percent of patients for whom physicians would recommend the intervention in low and high spending regions in each scenario: Low Spending Regions High Spending Regions Trend significant Cardiology referral for chest pain and no abnormal stress test MRI for back pain and mildly yes abnormal nerve function Drug treatment of high cholesterol with yes no other risk factors Urology referral for mild symptoms of yes prostatic enlargement Prostate cancer screening test for yes year old white male Visit for patient with isolated high blood yes pressure in 3 months or less Sirovich Archives of Internal Medicine. 165(19):2252-6, 2005 Oct 24 Sirovich, Journal of General Internal Medicine, Suppl May 2006

14 Differences in spending What are the underlying causes? Patient preferences? 1,2 Malpractice environment 3,4 Capacity / payment system 5 Clinical judgment 6,7 Slight preference for specialist care in high spending No difference for tests (if MD says not needed) No difference in preferences for aggressive EOL care Explains less than 10% of state differences in spending Little impact on growth in utilization across states Capacity strongly correlated, but explains less than 50% Payment system ensures all stay busy No difference in decisions with strong evidence More likely to intervene in gray areas (when to see patient, when to refer, when to admit) (1) Pritchard et al. J Am Geriatric Society; 46: , 199 (2) Anthony et al, under review (3) Kessler et al. Quarterly Journal of Medicine 1996;111(2): (4) Baicker, Chandra, NBER Working Paper W10709 (5) Fisher et al. Ann Intern Med: 2003; 138: (6) Sirovich et al. Archives of Internal Medicine. 165(19): (7) Sirovich et al, J Gen Intern Med. 2006;21(Suppl4):164.

15 What I think I know Local capacity and clinical culture drive practice and spending Clinical evidence (e.g. RCTs, guidelines) is a critically important -- but very limited -- influence on clinical decision-making. Physicians practice within a local organizational context and policy environment that profoundly influences their decision-making. Payment system ensures that existing (and new capacity) is fully utilized. Growth in capacity helps drive the evolution of new (more intensive) local social norms. Consequence: reasonable individual clinical and local decisions lead, in aggregate, to higher utilization rates, greater costs -- and inadvertently -- worse outcomes Clinical Evidence Professionalism Policy Environment (e.g. payment system) Local Organizational Context (e.g. capacity - culture) Physician - Patient Encounter

16 Spending, quality and the physician workforce Is it possible to provide good care with fewer physicians? Higher intensity treatment -- what are we getting? What s going on? What we need to know: how to identify and foster high performing health systems

17 Some thoughts on moving forward We need to consider underlying causes of rising costs, poor quality Underlying cause General Approach Failure to recognize key role of local system (capacity, clinical culture) as driver Assumption that more is better Equating less care with rationing Foster development of local organizations (delivery systems) accountable for care (with incentives to limit future growth) Balanced information on risks / benefits Comprehensive performance measures Payment system that rewards more care, increased capacity, high margin treatments, entrepreneurial behavior Reform of payment system (long term) Shared savings as interim approach

18 Payment reform: group accountability, shared savings Per-beneficiary spending in EHMS (n = 4772) sorted into quintiles by magnitude of per-beneficiary growth ( ) $4000 Absolute increase per benef. Percent increase ** Average Annual Rate $936 46% 9.9% Average spending* on MD services per beneficiary at EHMS $3000 $675 $551 $431 33% 27% 21% 7.3% 6.1% 4.8% $2000 $198 10% 2.4% * Using standardized payments, using 2003 RVU ** Percent increase calculated relative to average 1999 per-beneficiary spending

19 Payment reform: group accountability, shared savings Per-beneficiary spending in EHMS by BETOS category (highest and lowest quintiles of per-beneficiary growth ( ) Medicare spending per enrollee Percent increase in per-beneficiary spending % 27% 0% 2% 18% 29% 6% Lowest Growth Quintile % 116% 19% 38% 65% 80% 27% Highest Growth Quintile Differences in growth likely due to: active recruitment of physicians physician location decisions expansion of facilities (imaging) Control of spending will require altering incentives for growth Other Major Procedures Minor Procedures Tests Imaging E and M Each Quintile includes approximately 20% of the Medicare population

20 Moving forward Further expansion of the active physician workforce should be carefully considered The perception of scarcity does not necessarily imply shortages, but rather a mismatch between demand and availability. There are risks to expansion: actual costs; potential harms; opportunity costs. Different regions -- and organizations -- appear to produce equal or better health outcomes with fewer physician labor inputs -- and a different mix. A key question: how can we foster the development of high performing organizations -- those capable of providing high quality care with fewer resources.